The Acutec Philosophy
In the course of helping Acutec grow into a respected company serving aerospace clients worldwide, company chairman Rob Smith developed a philosophy consisting of 4 interlocking principles than can help organizations, communities, and individuals to prosper:
Always be lucky!
Wake up paranoid every morning!
There will be change. Get used to it.
Life is unfair. Learn it while you’re young.
Always be lucky!
Being lucky is the cornerstone of Acutec’s success. “Being lucky” involves more than just waiting for luck to come your way. It requires thoughtful action, in 3 steps:
- Putting yourself in a position to be lucky; that is, preparing to be lucky
- Recognizing when luck has come your way
- Taking advantage of your opportunity
Six months after Rob took over Acutec in 1994, the company’s largest customer, Lord Corp., in Erie, Pa., was growing rapidly and decided to outsource a large amount of machining. At the time, Acutec was a relatively small supplier for Lord and had spent 6 months repairing some broken fences with the company. At the same time, Acutec was reinforcing its internal quality and housekeeping standards. Acutec recruited some key machinists and established a strong core of skilled people ready to take on new business. Acutec also replaced some unproductive turning equipment with better equipment. In essence, Acutec was preparing to be lucky.
Acutec improved enough to receive an invitation from Lord to attend its supplier conference in Erie. At the meeting Rob found himself seated with people from far larger machining companies from across the US — from California, Michigan, Wisconsin, Indiana, and Philadelphia. Rob realized that, being just 30 minutes away, Acutec was Lord’s closest supplier.
The next morning Rob called the company together and reported that luck had come Acutec’s way. Now it was time to act. Acutec pounced on every opportunity to reinforce its proximity to Lord. At least twice a week Rob drove a delivery truck to Lord. In the course of delivering the product he got to know everyone in receiving, incoming inspection, and engineering. Then he took note of all the parts on the receiving dock that were made by other suppliers. He tactfully asked whether Lord experienced problems with any of those parts. Eventually, he told Lord’s purchasing agent that Acutec could provide the same parts with no problems. The entire company focused its attention on Lord. When Lord said “Jump!” Acutec asked, “How high?”
In summary, luck put desirable new business in Acutec’s path, we recognized an opportunity for which we were prepared, and we seized it. And tripled in size in two years.
More than 20 years later, Lord remains one of Acutec’s largest customers, only now Acutec’s annual sales to Lord are 5 times higher. When Lord says “Jump!” today, Acutec stills asks, “How high?”
As Acutec expanded, it soon outgrew its initial facility in Saegertown, Pa. As luck would have it, American Viscose abandoned a 1 million square-foot plant in the Meadville area. A local organization, the Economic Progress Alliance, turned Meadville’s loss into a competitive advantage for the community, developing innovative low-cost manufacturing space for light industry and offices. Acutec seized the opportunity to acquire 225,000 square feet in the building and turn it into high-performance aerospace manufacturing space to facilitate its growth.
Four times in recent years, when large aerospace companies searched worldwide for key suppliers to support their growth, they selected Acutec from among thousands of candidates. This happened because Acutec had placed itself in a position to get lucky. Many times other companies decline new opportunities because they are wary of additional work or they perceive risk, not realizing that even getting the chance to consider a new opportunity is an unbelievably lucky occurrence in itself.
During the last 5 years Acutec has invested over $40 million in new equipment and technology. Acutec has built IT, quality, manufacturing, and assembly systems second to none. Today Acutec’s CEO, Elisabeth Smith, is preparing for more luck by taking Acutec from a sound machining base into complex subassembly supply.
Wake up paranoid every morning!
Waking up paranoid is essential to the continued success of Acutec. It means waking up every day knowing somebody is working to wrest our business away. The minute we take a market, customer, or product for granted, we risk losing it. As Acutec expands, being paranoid keeps us humble. Company arrogance is the road to failure.
Waking up paranoid means we can’t settle for the status quo. Being complacent is not permitted. Waking up paranoid means continuous improvement. Each day we ask how Acutec can become better. Successful companies think of better ways to make, inspect, assemble, package, distribute, and sell their products or think of new products. Each day they must think of ways to offer better value to their customers. Acutec now has customers around the world, and we know competitors are emerging, waiting for us to err.
Every day, like it or not, we are in competition. Every Acutec employee, no matter what his or her job may be, is competing with someone else at another company somewhere in the world. Is sweeping the floor competition? Yes! When a prospective customer visits our facility and then our competition’s facility, and our floor is immaculate and theirs isn’t, did we compete? Absolutely! So we ask that all Acutec employees be a little paranoid and ask every day, “Is someone in Mexico or China doing a better job than I am?”
Being paranoid also means keeping a watchful eye on evolving technology. We do not want to become the best buggy whip manufacturer. Sometimes we must make substantial investments in technology that may not pay off for some time just so we never get left behind. Being paranoid means always learning. Acutec is committed to learning because learning fosters survival.
There will be change. Get used to it.
These days, change seems to come faster than ever. There are always improvements to be made, and in improving we will encounter change.
Everything we have learned we will have to relearn. Every piece of equipment we have moved most likely will be moved again. Our customers change constantly, both internally and externally. They open, close, are bought and sold, and we must adapt. Government laws and regulations are always changing.
Acutec and its employees embrace change. For example, much of the technology Acutec uses today did not exist when Acutec was started. Imagine if people at Acutec still received all their information from a fax machine, did every quote with a calculator and a piece of scrap paper, machined all of its parts using a manual Bridgeport, and marked its parts with a manual steel stamp. Could you imagine how long we would stay in business? To resist change is to resist the future.
Positive change happens after a methodical analysis of a situation and a careful response to it. Such change often is expensive, but it is necessary if we are to survive. Acutec invests in change, with new equipment, new software, new processes, and lifelong learning for its employees.
Life is unfair, learn it while you’re young.
As we go through life we experience many events that are unfair, or at least seem unfair, but how we react to these events is what makes all the difference. At Acutec we of course encounter many issues that seem unfair, involving the government, customers, and suppliers.
When something unfair happens, people tend to complain. But when we put our energy into complaining, we may fail to realize that what we regard as unfair circumstances actually are opportunities or life lessons.
At Acutec we try to catch ourselves whenever we start to say, “This is so unfair!” We try to step back from the issue and ask whether it is really unfair or just something new we need to learn about. We don’t dwell on the apparent unfairness. We overcome it, change it, or ignore it, and then we move on.
At Acutec we plan for circumstances to be unfair. When dealt a poor hand by circumstances, Acutec has learned how to turn that situation into an opportunity. For example, in recent years Acutec twice spent a lot of money to acquire new equipment to accommodate a customer’s needs, only to see each customer abandon the project at the last minute because of circumstances beyond our control. But with the new equipment in place and having skilled employees on the staff to operate it, we put our energy into finding new opportunities to serve other customers with our expanded capabilities.
In summary, if something seems unfair, we act. First, we try to change the immediate predicament to our advantage. If we can’t change it, we try to turn it into a new opportunity. If that doesn’t work, we learn from it and move on.